Auterion LLC, a start-up that provides software to military drones, has raised US$130 million to expand its operations abroad, including in geopolitical hotspots Ukraine and Taiwan, a further sign that private investors are pouring money into defense.
Bessemer Venture Partners LP led the financing round, which includes existing Auterion investors Lakestar LP and Mosaic Venture Lab, the company said in a statement on Tuesday. Auterion chief executive Lorenz Meier said the funding gives his company a valuation “north of” US$600 million, but declined to provide specific terms.
The start-up is part of a wave of small defense companies attracting record amounts of capital as investors eye windfalls from increased defense budgets across Europe. Drones have become ubiquitous in the Ukraine war, and NATO militaries are increasingly searching for ways to deploy the uncrewed vehicles in an air defense role after Russian incursions over Poland and Estonia.
Photo: Chiang Ying-ying, A
Formed in Zurich in 2017, Auterion initially serviced delivery drones. After Russia’s full-scale invasion of Ukraine in 2022, the start-up pivoted to defense, selling an operating system designed to give uncrewed aircraft better navigation and targeting capabilities.
Meier said Auterion makes drones cheaper and more effective with its autopilot and tools for “swarming,” in which multiple aircraft operate in coordination. Prominent competitors, such as Anduril Industries Inc and Helsing SE, also make drone hardware, but Meier said Auterion’s focus on software lets it work with multiple drone manufacturers and large defense contractors, likening its approach to that of Microsoft Windows.
“We’re software — simple, for everybody,” Meier said in an interview. “Our open approach is what the customer wants and needs.”
The company, based in Arlington, Virginia, is “close to” US$100 million in revenue and has turned cash flow positive, Meier said.
Auterion would use the fresh money for internal and external expansion, he said. The company plans to add teams and open new offices, as well as buy companies making applications that work with its drone system.
Auterion signed a US$50 million contract this year with the US Department of Defense to prototype low-cost, long-range weapons in partnership with an unnamed Ukrainian dronemaker.
In June, Auterion said it agreed to a multi-year deal to provide software to the Taiwanese military.
The company’s technology is already at work in Ukraine as a common operating platform to turn the hundreds of drone brands flying in the country into a coordinated swarm, he said, adding that the company would announce contracts with two European countries “soon,” without offering details.
Last year, Auterion announced a partnership with a German defense company Rheinmetall AG to develop software for drones. Meier declined to provide details about the partnership.
Auterion has now raised US$195 million to date, far less than some rival start-ups that build hardware.
“Right now, we’re a little company that’s growing really fast,” Meier said. “It sounds crazy, but if you look back, Windows and Android won the battle.”
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